Delayering and Firm Performance: Evidence from Swiss firm-level Data

Dieter Kuhn ()
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Dieter Kuhn: University of Basel

Working papers from Faculty of Business and Economics - University of Basel

Abstract: The past decades witnessed a broad trend towards flatter organizations with less hierarchical layers. A reduction of the number of management levels in a corpora- tion can have both positive and negative effects on firm performance with the net effect being theoretically unclear ex ante. NEWLINE The present study uses a nationally representative data set of firms in Switzerland and empirically examines the di- rect performance effects of delayering. Applying ordinary least squares regressions and propensity score matching, this study finds that delayering significantly increases subsequent firm performance. It can be concluded that flatter hierarchical structures seem to enable firms to better realize their competitive advantage in today's fast moving and knowledge-intensive market environment.

Keywords: Delayering; management levels; hierarchical layers; hierarchy; firm performance; treatment effects; selection bias (search for similar items in EconPapers)
JEL-codes: C21 J24 L22 L25 M51 M52 (search for similar items in EconPapers)
Date: 2011-01-15
New Economics Papers: this item is included in nep-bec, nep-eff, nep-lab and nep-sbm
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:bsl:wpaper:2011/02

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